The Nasdaq Composite (NASDAQINDEX: ^IXIC) climbed back above the 14,000 level early Thursday afternoon, rising nearly half a percent on the day as of 1 p.m. EDT. Investors were more excited about the Nasdaq's prospects than the rest of the stock market, as most other large-cap major market benchmarks were flat to lower on the day.
Lately, the biotech and electric vehicle industries have been important drivers of growth for the stock market generally and the Nasdaq in particular. Thursday's sizable gains from Ocugen (NASDAQ: OCGN) and Nikola (NASDAQ: NKLA) showed that those two powerful trends can still pack a punch when it comes to lifting the overall market. Below, we'll discuss why these two stocks were doing so well today.
Ocugen keeps climbing on good vaccine news
Shares of Ocugen jumped 17% early Thursday afternoon. The biotech company has been working closely with a developer of a coronavirus vaccine candidate in India, and the latest news from its clinical trials has made investors more upbeat about the immediate prospects for the vaccine.
Ocugen shares began rising on Wednesday after the company's India-based partner, Bharat Biotech, released the latest data from its phase 3 trial of its Covaxin candidate vaccine. The two-dose trial showed 78% efficacy in preventing COVID-19 infection, with 70% efficacy against asymptomatic COVID-19 infections. Covaxin has done even better in preventing severe cases requiring hospitalization.
India is going through a massive spike in COVID-19 cases, so the news is extremely encouraging for Bharat. For Ocugen, however, the key is making Covaxin available in the U.S. market, as its partnership with Bharat covers U.S. sales of the vaccine.
Investors are hopeful that the data could support Emergency Use Authorization from the Food and Drug Administration quickly enough for Ocugen to see demand for Covaxin. As vaccination efforts progress, however, the window for maximum profit potential could close for both Bharat and Ocugen.
Nikola makes a deal
Elsewhere, shares of Nikola were up 19%. The electric truck company is moving forward with a key element of its strategic plan, and investors are pleased to see some positive news after a long period of dealing with controversy.
Nikola announced an agreement with TravelCenters of America (NASDAQ: TA) to provide for the installation of hydrogen fueling stations for heavy-duty trucks. The companies will collaborate initially on two installations at existing TravelCenter-Petro stations in California, with the goal of having them ready for commercial operation by the first quarter of 2023.
Nikola hopes that putting hydrogen infrastructure in place at key locations in the U.S. will help accelerate adoption of hydrogen fuel-cell technology, including its own Nikola Tre fuel-cell electric vehicle. The two locations will specifically allow for zero-emission commercial vehicle transport in and around Los Angeles and into the Central Valley region of California.
To succeed, Nikola will have to work on multiple fronts simultaneously, not only making sure that the infrastructure is in place to support its fleet of vehicles but also moving forward with design, development, and production of those vehicles. It's that second part of the strategy that has some investors still nervous about Nikola's long-term prospects, and that's why even after today's gains, the stock is down more than 80% from its highs last summer.
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